Petronet’s Qatar agreement covers 7.5 million tonnes of LNG annually

Petronet LNG has a long-term agreement with QatarEnergy to purchase 7.5 million tonnes of LNG annually. The existing contract is due to expire in April 2028, and the renewed agreement will extend supplies for another 20 years, until 2048.

The renewed arrangement is based on delivered supplies, meaning QatarEnergy is responsible for shipping the contracted LNG to India under the agreed terms.

Petronet’s proposal is to diversify the source of some of these contracted volumes rather than abandon its Qatar agreement.

Vivek Mittal said Qatar was willing to consider the request and could provide a portion of the contracted volumes from other sources it has secured.

This could allow Petronet to receive LNG produced in the United States through its long-term commercial relationship with Qatar, subject to the final arrangements between the companies.

Key details of the Qatar supply agreement

Particulars	Details
Indian buyer	Petronet LNG
Supplier	QatarEnergy
Annual contracted volume	7.5 million tonnes
Renewed contract period	20 years
Supply period	2028–2048
Proposed diversification	Some volumes sourced from the US
Current status	Discussions underway

The proposed arrangement is particularly relevant because Qatar has itself been expanding its exposure to American LNG production.

QatarEnergy is securing LNG from US producers

QatarEnergy has signed long-term agreements with American LNG producers, creating a potential supply channel for the proposed arrangement with Petronet.

In October 2026, QatarEnergy signed a 20-year agreement with Australia’s Woodside Energy for approximately 3 million tonnes of LNG annually from its US facilities. Deliveries are expected to begin in 2030.

QatarEnergy has also signed two agreements with US-based Cheniere Energy for up to 4 million tonnes annually from its Sabine Pass and Corpus Christi LNG facilities. These agreements extend through 2054.

The contracts are significant because they expand QatarEnergy’s access to LNG produced outside Qatar.

US LNG supplier	Contracted volume	Expected supply period
Woodside Energy’s US facilities	3 million tonnes annually	From 2030
Cheniere Energy	Up to 4 million tonnes annually	Agreements extend through 2054

These agreements could give QatarEnergy additional flexibility when managing its international LNG supply commitments.

For Petronet, the possibility of receiving some US-produced gas through Qatar could reduce dependence on a single production region while retaining the commercial structure of its long-term agreement.

However, the proposed arrangement is still under discussion. No final volume allocation, pricing structure or delivery schedule for US-origin LNG under Petronet’s contract has been announced.

Iran conflict disrupts Qatar’s LNG supplies to India

The discussions have gained urgency because of disruptions to LNG shipments from the Gulf.

Qatar declared force majeure on LNG supplies in March 2026 after the conflict involving Iran disrupted shipping through the Strait of Hormuz and affected facilities at Ras Laffan, Qatar’s major LNG production and export centre.

Force majeure is a contractual provision that can excuse a party from certain delivery obligations when extraordinary circumstances prevent performance.

The disruption affected Petronet’s contracted cargoes and forced Indian gas companies to look for alternative supplies.

According to Petronet’s management, approximately 75–80 cargoes expected between March and October 2026 had been delayed because of the disruption. The company also has around 15–16 older cargoes pending from a settlement agreement relating to pricing disputes in 2015–16.

This brings the number of outstanding cargoes to approximately 90 or more.

Petronet is negotiating with Qatar to receive these delayed shipments earlier once conditions normalise, rather than waiting until the full contractual recovery period.

The existing arrangements allow delayed and force-majeure-affected cargoes to be delivered during a designated recovery period. The company is seeking faster deliveries to meet India’s gas requirements.

QatarEnergy’s force majeure was extended through December 2026 at the time of the latest reporting.

India turns to the US, Oman, Nigeria and Australia for alternative LNG

The disruption has accelerated India’s efforts to diversify its natural gas imports.

Petronet and other Indian companies have been sourcing LNG from several countries to compensate for the shortfall in Qatari supplies.

The United States has emerged as an important alternative because of its expanding LNG export capacity.

Other suppliers include Oman, Nigeria and Angola, while Australia also remains an established source of LNG for Indian buyers.

The diversification strategy is not limited to finding replacement cargoes during the current disruption. It also reflects the need to reduce the risks associated with relying heavily on a single geographical region.

For India, the availability of alternative suppliers can help improve supply flexibility when geopolitical events affect shipments from the Gulf.

However, alternative sourcing does not automatically guarantee lower prices. LNG buyers must consider transportation costs, contract terms, global demand, shipping availability and the reliability of deliveries.

Why the Strait of Hormuz matters to India’s gas supply

The Strait of Hormuz is one of the world’s most important energy shipping routes.

Qatar’s LNG exports depend heavily on maritime access through the strait. When shipping is disrupted, cargoes can be delayed or prevented from reaching international buyers.

India is particularly exposed because Qatar is its largest LNG supplier and the long-term agreement with Petronet represents a substantial part of its contracted imports.

The recent disruption has demonstrated how a regional security crisis can affect industries far beyond the Middle East.

Natural gas is used in fertiliser production, city gas distribution, electricity generation, industrial manufacturing and petrochemicals.

A shortage of imported LNG can therefore affect several parts of India’s economy.

Diversifying supply sources and improving infrastructure flexibility could help reduce the impact of future disruptions.

Petronet expands LNG infrastructure to accommodate future supplies

Petronet is also increasing its capacity to handle additional LNG imports.

The company’s Dahej regasification terminal in Gujarat has expanded its capacity to 22.5 million tonnes per year from 17.5 million tonnes.

Regasification terminals convert LNG, which is transported in liquid form at extremely low temperatures, back into natural gas so that it can be supplied through pipelines.

The expanded capacity could help Petronet accommodate additional cargoes when supplies recover.

However, the availability of terminal capacity is only one part of the supply chain. Actual imports will also depend on contracted volumes, shipping access, storage arrangements and demand from domestic customers.

The company has indicated that it expects to be able to accommodate higher supplies at Dahej during 2028–29.

India’s ambition to increase natural gas consumption

India has set a target of increasing natural gas’s share in its primary energy mix to 15% by 2030, compared with approximately 6% at present.

The government sees natural gas as an important fuel for industrial growth and as a transition option alongside renewable energy.

LNG imports are central to this ambition because domestic natural gas production is not sufficient to meet the country’s overall requirements.

Long-term contracts with Qatar and other suppliers provide a foundation for securing imports, while purchases from the US and other markets offer additional flexibility.

The challenge is to balance energy security with affordability. Higher LNG prices can increase costs for fertiliser manufacturers, power producers and industrial customers.

A more diversified import portfolio could reduce exposure to individual suppliers and shipping routes, although it cannot eliminate global price volatility.

The Bigger Picture

Petronet’s discussions with Qatar reflect a change in how India is approaching long-term energy security. Instead of depending entirely on the geographical origin of contracted gas, the company is exploring whether its supplier can provide some volumes from alternative production sources, including the United States. QatarEnergy’s own agreements with US LNG producers create a potential route for this diversification.

The proposal remains at the discussion stage, and its commercial value will depend on the final pricing, volume allocation and delivery arrangements. Nevertheless, the broader strategy is clear: India wants more reliable access to LNG by diversifying suppliers, strengthening import infrastructure and reducing dependence on vulnerable shipping routes. The experience of 2026 has made energy security an increasingly important consideration alongside price.

Looking Ahead

The next important development will be whether Petronet and QatarEnergy agree on the quantity of US-origin LNG that can be supplied under the renewed contract. Investors and gas consumers will also watch whether Qatar can resume delayed deliveries and restore normal shipments through the Strait of Hormuz. The timing of US LNG availability is another consideration because some of QatarEnergy’s new American supply agreements begin only in 2030.

For India, the proposed arrangement could provide an additional layer of supply flexibility without requiring Petronet to abandon its existing Qatar relationship. The country’s ability to meet its growing gas demand will depend on a combination of long-term contracts, alternative suppliers, reliable shipping routes and adequate regasification capacity. The outcome of the discussions could therefore have implications for India’s energy procurement strategy well beyond the immediate disruption.